After Fanny Mae and Freddie Mac - Georgie Os?

How can George Osborne be so timid on the tax and spending front and so cavalier when it comes to credit? His scheme for subsidising home ownership is, in effect, HMG (and ultimately you and me) buying stakes in private homes. And these are homes being purchased by the people who, self evidently, can least afford them. Am I being daft or is this not the way the US got into their disasterous sub-prime fiasco a few years ago?

Marchant Joins Doom Mongers

So Ian Marchant is also warning us that the lights might go out. There is an implied criticism of legislators in what Marchant says - and in my post of a couple of weeks ago I said that HMG had failed to put in place proper incentives for generators to build new plant. However, Marchant is being somewhat disingenuous. The start of this county's value chain is its energy sources - first primary fuels and next, inter alia, electricity. Marchant knows this. Other generator bosses know this. Is there not a collective moral duty on them to ensure that the rest of the country does not suffer because of their failure to build new plant?

Not The Greatest Of Pictures

It's not the greatest photo' but I was so pleased to spot a leopard in the wild during our recent Sri Lankan holiday.

Should Electricity Utilities Vertically Integrate?

I have been through the "nationalised industry is privatised and disaggregated only to re-aggregate at a later stage" cycle so I was interested to see that Bain & Co have recently published a short piece on how utilities should evaluate the benefits of vertical integration.

Sadly I was rather disappointed. Admittedly it was advertised as a "Bain Brief", and brief it was. Bain consider just three motivating factors: avoiding transaction costs, hedging against volatility, tapping different profit pools. Not surprisingly they show that under many circumstances integration does not add significant value through these drivers in an piece of analysis that any half decent MBA student could have produced.

I rather expected more from a top strategic consultancy.

New Gas Plant - Why Is This Suddenly News?

So Alistair Buchanan thinks the UK urgently need new gas generators. Why this sudden flurry of angst? There have been pretty good demand forecasting models knocking around the UK for ages. And we've all known about the likely effects of the LCPD for years. Furthermore, the retirement of nuclear plant has been pretty easy to predict. So it's been obvious (and even pointed out in this ill-informed blog) that "something had to be done" to avoid a generation squeeze.

The good old CEGB had plenty of things wrong with it (it employed me, after all), but it did manage to build a reasonable size of plant margin. The privatisation market solution has undoubtedly driven out costs but it would appear that HMG and its advisors have failed to ensure that the right incentives are in place to promote a sensible replacement programme.

So are we going to have a second dash for gas and blow the CO2 emissions targets, or should we be looking forward to a few winters with brown-outs?

An ACE Approach

Still catching up I'm so glad to read this in the edie bulletin. The consequential improvements idea is something that has been on the energy conservation agenda since before I joined the Energy Saving Trust a good number of moons ago and still CLG is being dog-in-the-manger about it. I have referred before to that wierd and wonderful place "Planet Pickles" and I remain amazed at some of the bizarre decisions that come from his Department.

If this country is going to be serious about CO2 emissions reduction then everyone, but everyone, will have to play his/her part - including extension builders. It's a no-brainer and the sooner CLG minions and Mr Pickles understand this and act accordingly the better.

So, well done ACE for taking this whole debacle to judicial review. In the past Andrew Warren and I have not necessarily been eye-to-eye on things energy saving but in this case the action is bang on.

Interesting Micro-Wind Turbine

Catching up after my holiday I've only just come across this piece in edie about the Urbine.

What Vince says about advantages of vertical axis turbines over more conventional horizontal ones in built-up areas seems to make sense. It will be interesting to follow the testing.

One thing, though. Why the references to windmills? There's no milling going on. Let's do our bit to preserve the diversity of the English language!

Just Smile

I've just returned from a holiday in Sri Lanka - well organised for us by Sri Lanka in Style.

One of the features that will long remain with me is the fact that all around one there were generally smiling faces. Many of the people we encountered are very poor - us middle-class Brits were considered most wealthy - and yet everywhere there were beaming grins. An ex-pat friend suggested that the moan gene does not exist in Sri Lanka  - we winge about our well-loaded, privileged lot and they are just happy.

I am going to try to meet them half-way. This blog will still feature the odd rant or two but out in the real world I shall try to smile, be happy with what I have, not even grumble about our politicians (that'll be a hard one), and generally be nice to folks. Would it not be a good thing if we all aimed to do that?